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WorksheetsPersonal Finance Review
Total questions: 25
Worksheet time: 1hrs 10mins
Name
Class
Date
1.
Bob is working for a bank. He earns $8.00 an hour, works 40 hours a week, and gets paid every 2 weeks. Every pay period he pays $63.08 into federal withholdings tax, $33.21 into state withholdings tax, and $42.05 into FICA (Social Security Tax). What is Bob’s net pay on his paycheck?
a)
$501.66
b)
$363.32
c)
$576.92
d)
$640.00
2.
In relation to other options, how liquid is a savings account?
a)
More liquid than cash
b)
Less liquid than mutual funds
c)
More liquid than a certificate of deposit
d)
More liquid than a checking account
3.
When a goal has been set to save $100.00 a month for an emergency fund of $2,000.00, giving up food from the vending machine to achieve that goal is the:
a)
opportunity cost.
b)
interest.
c)
specific part of the SMART goal.
d)
trade-off.
4.
One’s lifestyle is to their standard of living as present is to:
a)
past.
b)
recent.
c)
future.
d)
gift.
5.
Andy is developing an Income and Expense Statement. He has gathered all his receipts, bank statements, paycheck stubs, and spending records. He needs to categorize them into income and expenses. He is unsure which items should be recorded as expenses. Which should be recorded as expenses?
a)
Taxes deducted from his paycheck, money saved from his paycheck for emergencies, and his car insurance
b)
Money saved from his paycheck for emergencies, interest paid on his car loan, and his tax refund from filing last year’s tax return
c)
The scholarship he receives for studying Chinese at the local community college, his car insurance payment, and stock dividends he received from his grandmother
d)
Clothing he purchased for a job interview, tuition for a class he is taking at the local community college, and interest from his savings account
6.
Mark and Susan, a recently married couple with full‐time jobs, set a goal of putting $200 in savings every month to make a down payment on a home in five years. What type of goal have they set?
a)
Short‐term
b)
Intermediate
c)
Long‐term
d)
Unrealistic
7.
Michael wants to develop a spending plan for himself to use during his final year of high school. What will he need to do as his first step?
a)
Decide what income and spending categories would reflect his values, needs, and wants.
b)
Decide how much money he can spend for each of the bills he pays each month.
c)
Track his current income and expenses—if he has already created an Income and Expense Statement then he has completed this step.
d)
Develop a control system that will work with his life style.
8.
Kaylee will save her allowance of $25 per month to purchase a $150 MP3 player in six months. This is an example of what type of goal?
a)
Short‐term goal
b)
Long‐term goal
c)
Mid‐term goal
d)
This is not an example of a goal.
9.
When Charles received his college placement test results, he is informed that he will need remediation in math. Which situation is not true of Charles’ situation?
a)
Charles will need to take at least one course because he is not college-ready.
b)
Since the remedial courses Charles must take will not count toward his degree, he needs to take the courses but tuition is not charged.
c)
Charles should have taken a placement test earlier in high school so he could strengthen his academic skills before heading for college.
d)
Remediation courses do not count toward his degree program so he may need to take extra credits and his college degree may take longer to complete.
10.
Perry would like to purchase a new car. What should he consider first in the planned buying process?
a)
Research different sellers to determine where to purchase the car from
b)
Evaluate the opportunity cost and trade-offs to purchasing the car
c)
Rank product features in order of importance
d)
Calculate the cost of ownership
11.
Eric is writing a paper on the importance of investing in yourself and he is looking for a sentence to use as the thesis statement for his paper. Which sentence below would be the best choice?
a)
Completing your college degree is the best way to prepare for a career.
b)
Education pays in higher earnings and lower unemployment rates.
c)
Human capital and transferable skills result from formal training.
d)
Investing in yourself too early can lead to a lower standard of living.
12.
As part of Nicholas’ new job, his employer will provide health, life, and disability insurance. Access to this insurance is provided in addition to his regular salary. This is known as:
a)
government programs.
b)
household production.
c)
coverage.
d)
employee benefits.
13.
Which of the following is likely to have theleast influence on an individual’s values?
a)
Media
b)
Family
c)
Religious affiliations
d)
Grade average
14.
Erica is an active member of the Silver Cord program at her school. Through this program, she commits to completing at least 25 hours of community service each year of high school. Her advisor has encouraged her to explore volunteering with nonprofit organizations. Which would qualify as a nonprofit?
a)
An extracurricular activity in her school
b)
The local private daycare center
c)
Big Brothers/Big Sisters
d)
Her elderly neighbor who needs yard work done
15.
Charis wants to decrease the risk of fraudulent use of her credit cards. Which strategy would be the most effective?
a)
Carrying all credit cards in her wallet so they do not get lost
b)
Signing the back of her card with her signature and “Please see picture ID”
c)
Giving account numbers over the Internet rather than over the phone
d)
Using credit cards for all her purchases so she only needs to pay one bill each month
16.
When is your spending plan complete?
a)
When you have allocated all your income into categories for the month
b)
When you have all of your current income and expenses recorded
c)
Spending plans are always under revision so they are never complete.
d)
Spending plans are complete each December 31st as one year ends and another year begins.
17.
In which scenario should renters insurance be considered?
a)
Steve and Teri have purchased a home in a rural area.
b)
Tim and Hanna are living with his parents in the basement of their home for six months while flood damage is being repaired in their home. They are paying his parents rent during the time they are living in their home.
c)
Zach and Leah have rented an apartment in an urban area.
d)
Don and Denise are landlords for several rental properties.
18.
Susan is currently working in Kansas City, MO earning $30,000 per year. She is offered a position in Indianapolis, IN earning $32,000 per year. If Kansas City’s Cost of Living Index is 100 and Indianapolis’ Cost of Living Index is 125, which is true?
a)
Susan will have more spending power if she moves to Indianapolis.
b)
Susan will have more spending power if she stays in Kansas City.
c)
Susan will have the same spending power in Indianapolis as she has in Kansas City.
d)
There is not enough information to decide.
19.
Jaimen is struggling to make his student loan payments after college. He is considering defaulting on the student loan. Which is not a potential consequence if he decides to default on the student loan?
a)
He could be denied credit cards, car or home loans, or apartment leases.
b)
The bank could refuse to allow him to open a checking account.
c)
He may not be able to obtain a marriage license.
d)
His wages may be garnished.
20.
Dylan is concerned about the safety of the money in his savings account. Which type of depository institution should he choose?
a)
A commercial bank, since his deposits would be insured by the Federal Deposit Insurance Corporation (FDIC)
b)
A credit union, since his deposits would be insured by the National Credit Union Association (NCUA)
c)
He could safely choose either a commercial bank or a credit union, as long as his savings account balance meets the insurance requirements.
d)
Neither a commercial bank nor a credit union. Money is most safely kept at home in a personal safe or vault.
21.
Maggie will need to pay $120 per month in order to purchase a health insurance policy. This monthly payment is known as the:
a)
deductible.
b)
co‐insurance.
c)
premium.
d)
moral hazard.
22.
Amber’s academic adviser has asked her to set 3 academic goals for this semester. These goals are most likely to be accomplished if:
a)
Amber discusses her goals with her parents
b)
Amber lets her friends set her goals.
c)
Amber writes her goals down.
d)
Amber thinks about her goals weekly
23.
What is the difference between property and liability insurance?
a)
Property insurance pays for loss to the insured person whereas liability insurance pays for loss to other people.
b)
Property insurance pays for loss to other people whereas liability insurance pays for loss to the insured person.
c)
The difference between property and liability insurance depends on the specific insurance policy purchased.
d)
The difference between property and liability insurance depends on whether automobile, homeowners, or renters insurance is purchased.
24.
Megan’s credit card statement indicates that she is now paying a penalty APR. Which scenario best describes why?
a)
Megan missed making her January and February credit card payments while she was participating in her college’s Study Abroad program when the friend she left in charge of sending the payments in forgot.
b)
Megan’s credit card payment has been paid in full each of the last 6 months.
c)
Megan’s card had a lower introductory interest rate for the first year and now the interest rate has increased, as stated on her contract.
d)
The new computer Megan purchased made her account go over the credit limit for 1 week, until the credit card company processed her credit card statement.
25.
Elliot’s stock broker is suggesting that he consider investing in a diversified portfolio. A diversified portfolio is desirable because it:
a)
increases the risk/return ratio.
b)
limits investor choices to only one or two investment tools.
c)
indicates an investor is a good predictor of the return an investment will have.
d)
decreases risk by investing money in a variety of investment tools.
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